U.S. mortgage rates posted their biggest weekly jump in a year as inflation fears tied to the war with Iran cloud the spring housing outlook, Bloomberg reports.

The average 30-year fixed mortgage rate rose to 6.11% from 6% last week, Freddie Mac said Thursday.

Rates briefly dipped below 6% in late February as lower borrowing costs and flattening home prices raised hopes for a stronger spring homebuying season. But the Iran conflict has added fresh uncertainty.

A prolonged war could push oil prices higher, fueling inflation and lifting Treasury yields that guide mortgage rates.

Even after the increase, borrowing costs remain below a year ago, when the average 30-year rate stood at 6.65%.

Housing had begun showing modest improvement after years of sluggish demand.

Existing-home sales unexpectedly rose in February, according to the National Association of Realtors, while the group’s housing affordability gauge recently reached its most favorable level since 2022.

Still, rate volatility may keep buyers cautious.

“The outlook for market activity this spring is lower than it was a month ago when rates were moving lower,” said Lisa Sturtevant, chief economist at Bright MLS.